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In its Sizing the Cloud report, the research firm outlined three key trends in the next 10 years: infrastructure as a service (IaaS), virtualisation and software as a service (SaaS).

The early successes of Amazon EC2 and Rackspace have prompted many other providers to offer IaaS solutions, but this market will reach a peak of $5.9bn in global revenues in 2014 before entering a period of commoditisation, price deterioration, and margin pressure, says the analyst firm.

Virtualisation is also reaching the end of its main growth cycle, with technologies that allow virtualisation of large-scale, server-based enterprise applications gaining prominance, it adds.

However, SaaS represents the largest and most sustainable growth opportunity, due to a rapidly increasing demand from companies of all sizes, says the research.

"SaaS applications tend to be bought by business people who are less concerned about the issue of privacy than IT staff and developers, who tend to buy the IaaS applications," said Forrester analyst Stefan Ried.

"IT staff are used to privacy challenges from their efforts spent installing on-premise technology and security."

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